IN THIS CHAPTER
- Taking steps to ensure a positive customer impression
- Planning well in advance and executing consistently
Companies invest millions of dollars each year in developing new products and trying to
increase their revenues and profitability . Some of these are good products, and some
aren’t. Nonetheless, they all have one thing in common: Without appropriate launch and
marketing activities, they’ll most likely fail. In fact, many inferior products have won in the marketplace simply because the company’s launch and marketing were more effective than those of their competitors with the superior product.
The key to an effective product launch is to create and execute a plan that is appropriate to meet your goals given your resource, budget, and time constraints. This chapter covers the ten most common mistakes that occur in product launches so you can avoid making them.
Failing to Plan Early Enough
Many companies wait to plan their product launch until they’re just a few weeks away from the product being ready . Effective launches take much more time and effort than many people realize. Build your launch plan a minimum of four months prior to product
availability . This time frame gives you enough opportunity to plan for and execute
extensive public relations activities and marketing programs and to get all the positioning, messaging, collateral, and pricing finalized. It also allows enough time to communicate to your partners (and internal groups, if your company is large) so that they can prepare for and support your efforts.
You can pull off product launches in a matter of weeks, but doing so is extremely stressful, leads to miscommunication and poor execution, and ultimately usually results in less-than-optimal results and lower revenues. Do yourself and your company a favor and start early — it will dramatically increase your chances of success.
Not Having a Sustaining Marketing
Plan in Place
One of the biggest launch mistakes, particularly in high-tech fields, is that companies
assume that the launch is an event unto itself and that the initial buzz generated,
combined with the excellence of the product, will be enough to generate ongoing sales
momentum. If the product is exciting and the company achieves a lot of initial press
coverage and revenues, the company often becomes convinced that it has hit the magic
revenue generation formula and that all is well.
Unfortunately , what often happens is that after an initial post-launch spike in sales and
excitement, revenues quickly drop to a much lower level. The company is then baffled.
After all, it had clear indications that things were going well at and just after launch. The
company forgot that customers need to be reminded on an ongoing basis that a product
exists and solves their problem or they stop buying.
Effective marketing programs take several weeks (and sometimes months) to plan and
execute, so the company is now in a bind. Getting adequate programs going takes quite a bit of time, and in the meantime revenues will continue to miss expectations.
The key to avoiding this situation is to plan realistic sustaining marketing programs well in advance of launch to ensure that you meet your key goals, such as lead flow and revenue generation. Sustaining marketing programs are ongoing marketing activities such as web ads, short-term promotional pricing, and webinars that remind customers to buy your product. Figure 20-1 shows the difference in sales when sustaining marketing is planned as an immediate follow on to launch activities. Don’t wait until the product is already in the market to get your sustaining marketing planning and execution going.
Shipping a Poor Quality Product
Letting a poor quality product out the door is a potentially deadly mistake because it can
sometimes be impossible to recover from. If the press gets hold of your product and it
doesn’t work as promised, or if customers have a bad experience with it, the product
image and brand may be tarnished permanently . During the dot-com boom, you could find literally thousands of examples of products that customers tried once and then were never willing to try again.
The best way to avoid this problem is to set quality goals early and gain consensus on their adoption among all the key stakeholders, including the executives involved. If you’re as tart-up, wanting to get first version of the product out is tempting. If you’re a public company , you may be under immense pressure to meet quarterly goals. And there is always the temptation to ship a product that isn’t quite ready but that can be “fixed” with downloads from the Internet by the time it’s in the hands of many customers. Set concrete goals quality goals early (see the Chapter 13 ) and be diligent about sticking to them. After all, your team has worked hard to create a product that can be successful. Don’t jeopardize it by releasing it too early .
Inadequately Funding Launch
Companies often believe that they have such a compelling product that for a small amount (a few thousand dollars), they’re going to be able to launch a wildly successful product.
This situation is particularly true with products that have a viral marketing component.
Companies overestimate how viral the product will actually be and whether customers will really care about it. The reality is that viral products and wild successes are few and far between.
One way to avoid this mistake is to do a return on investment (ROI) analysis. ROI is the
profit you make based on the money you spend. Follow these steps:
- List all the ways you’re going to reach customers: announcements,
product reviews, marketing programs, word of mouth, online
advertising such as Google AdWords, and so on . - Roughly estimate how many impressions you plan to make to your
target market and how many of those you can expect to turn into leads. - Estimate what you think your close rate will be for those leads.
For example, do you believe that 10 percent of them will actually buy your
product and pay you money? - Calculate your ROI.
The formula for return on investment is ROI = Net Profit ÷ T otal Investment ×In Figure 20-2 , ROI = 376,800 ÷ 500,000 × 100 = 75 percent.
Calculating ROI helps build a reality-based picture so you can make more informed
decisions about what an adequate spending level really is.
Underestimating the Required
Marketing Exposure
Studies show that potential customers need an average of at least seven exposures to your marketing message before they have enough awareness to take action. This need for repetition is one of the reasons that marketing after the product launch is so critical. Don’t assume that reading about the product once or clicking on an ad one time is going to create enough awareness and desire for the product that people will purchase it
immediately . Have a look at Chapter 15 for how to create customer exposures to your
product through different marketing activities. Unless your product is life-changing or is so simple and compelling to try , you’re better off being realistic about just how much
exposure and marketing it will really take to drive sales.
Driving Customers to Buy Your
Competitor ’s Products
Nothing is more disappointing than launching and marketing a product only to have
prospective customers purchase your competitor’s product instead. You’re essentially
educating the market and creating awareness in order to lose a sale (and potentially the
lifetime relationship with that customer) to a competitor who is trying to put you out of
business.
How do you avoid handing customers to your competition on a silver platter? First, make
sure your product is widely available at launch so that customers can find it and, more
importantly , won’t accidentally stumble across another alternative. Second, make sure you set the competitive argument in your positioning, messaging, packaging, collateral, and anywhere else possible. When you set the competitive argument, you describe the problem in a way that gives your product the advantage in any comparison. Unless your
competitors are completely unknown and customers have no chance of finding them, you want to make sure you have the proof points and messages in place to present your
product as the best solution and the only logical choice. Since search engines ensure even the smallest competitors can be found, part of your messaging should address either your experience (for established companies) or your cutting-edge advantage (for new companies pushing into exciting new product areas). And finally , don’t announce your product too early (as we discuss in the next section).
Announcing Too Early
If you announce your product too early , you run several risks:
- You’re playing your cards publicly , so any competitors can respond before your product becomes available. They can change their marketing to reset the competitive argument, for example.
- The announcement may drive customers to investigate other options and become aware of or even purchase your competition.
- When your product does ship, you may not be able to get any press coverage because your item is old news.
Announcing products early is tempting for a number of reasons. You may have a great idea you want to be able to share with the world early on so you get credit for coming up with it. Or a competitor may already have an offering you’re scared will grab all the mindshare and leave you with no opportunity when your product is available.
Large companies sometimes use an early announcement to prevent customers
from considering smaller company alternatives. The common term for this tactic is
FUD , which stands for fear , uncertainty , and doubt. Customers who are loyal to a
large company brand often prefer the safe route of waiting for the large company
solution rather than take the risk on a smaller , unproven company . If your company is
big enough, consider pre-announcing to keep space for your alternative in the market
place.
You may also announce the product too early because your confidence level in your
development schedules is too high. You should typically assume that the launch is
going to happen 30 days later than the planned date. Deciding on how early is too
early is related to your sell in cycle (see Chapter 15 ). For B2B customers, launching
early would be a time period greater than 25 to 50 percent of your sell in cycle. The
idea here is that being just a little bit late with an excellently executed product launch
is better than announcing a product that then isn’t available. Nothing is more
frustrating and decreases potential revenue than driving lots of customers to seek out
your product based on your announcement only to have them never return again.
Not Having a Dedicated Product
Review and Public Relations Program
Product reviews can be your greatest ally or your worst nightmare. Good reviews validate your product with an external source and provide much more credibility than your own marketing or advertising ever could. Poor reviews, on the other hand, can stop customers in their tracks during the purchase process.
The choice you must make is whether you want to proactively manage the review program or reactively respond to it if a problem occurs. Proactively managing a review program means creating supporting documents (reviewer’s guides) and having ongoing
conversations with reviewers as they review your product. Your goal is that they recognize and report on valuable aspects of your product. And hopefully , spend less time on the weaker parts of your product. Of course, if a problem occurs during a review , it’s usually too late to do damage control. Even if a publication prints a retraction to clarify the facts, the majority of the people who read the bad review will never see the revision. They’ll believe your product isn’t good.
Few companies understand how much time and effort running a full-scale proactive
product review program takes. However , product review programs conducted correctly
and with the proper amount of resources, can greatly improve product reviews.
Larger companies have public relations (PR) folks in house who work with specialist public relations firms outside the company to target specific publications, bloggers, and industry influencers and analysts. Smaller companies hire a PR consultant or keep one on retainer (pay them a small monthly fee). Press or PR takes a lot of communication framing and coordination work, and product managers are not specialists in this area. PR work includes generating interest in your product by getting press and analysts excited about your product, having great attendance at press and analyst briefingss and, more specifically , asking for publications to review your product. Customers rely heavily on press reviews when making product decisions as the reviewer is perceived to be an unbiased information source.
Industry analysts, more commonly referred to simply as analysts, are specialist firms that develop secondary research about your product and industry . See Chapter 6 for further reading on secondary research. At launch, you are setting the stage for secondary research firms. Figure 20-3 shows the timelines and activities for analyst and press programs. We recommend planning press and review activities from four to six months prior to launch.
Delaying Communication
One mistake that can hamper launch success is failing to brief and inform the key
constituents early enough. The key constituents are internal, channel partners, and press and analysts. When you aren’t in contact with these specific internal or targeted audiences ahead of time, here’s what can go wrong:
- Internal marketing and sales: In a big company , you may lose opportunities to take advantage of events, sales opportunities, or marketing programs that other groups are running.
- Channel partners: If you don’t give your channel partners enough advance notice, they may take quite a bit of time to work your new products into their plans.
- Press, bloggers, and analysts: You want to brief these folks far in advance so that positive announcements, news, and reviews about your product run concurrently with product availability . Note: Briefings are given under non-disclosure agreements (NDAs) and are subject to embargos so that news about the product isn’t made available to the public until the day of launch.
Communicating early to your key constituents does have some risks. Y our
competitors may get wind of what you’re doing. Y our salespeople may stop focusing
on selling the current product and sell future products instead. And if you miss your
date by a substantial amount, you may lose credibility for future launches. For
companies where the risk of leaks is too high (one example is Apple), the solution is
that no internal communication (other than to the people that absolutely need to know
like a small marketing team) is made until the day of launch and then the planned
communications roll out happens very quickly .
Considering International Markets as
an Afterthought
The international market is often a significant revenue opportunity , but it’s one many
companies fail to plan for because they’re so focused on the domestic market. Make sure you communicate to your international divisions (within your company) and international partners (outside your company) early enough so that they can make plans accordingly .
Ask your international product managers, marketing, and sales to find out just how long
before launch bringing in international partners is appropriate. Three months isn’t
uncommon; however , the type of product you work on and the markets you work in change a lot of timing.
To save time and energy and ensure your messaging is coherent on a worldwide
basis, design all your launch materials (collateral, marketing pieces, packaging, and
so on) so that they can be used in international markets with little or no adjustment. If
your material needs to be translated (the official term is localized ), your materials
have to be ready even earlier than for the domestic market. Delivering coherent
messaging and delivery of information within localization lead times reduces the time
required to generate international revenues by three to six months.
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